CCI’s Draft Amendments to the Competition Commission of India (Commitment) Regulations, 2024

The Competition Commission of India has released draft amendments to the Competition Commission of India (Commitment) Regulations, 2024 with the objective of refining the newly introduced commitment mechanism under the Competition (Amendment) Act, 2023. These changes are designed to fine-tune procedural rules, address practical difficulties noticed in the initial months of implementation, and make the commitment route a more predictable and efficient enforcement tool.

Under the commitment framework, enterprises facing inquiries for alleged violations of Section 3(4) or Section 4 of the Competition Act, 2002 can voluntarily propose commitments to remedy competition concerns, in lieu of undergoing a full-fledged investigation and adjudication. The proposed changes focus primarily on:

  • Rationalising filing timelines and overall proceeding duration
  • Introducing a structured mechanism to rectify application defects
  • Clarifying treatment of invalid applications and fee adjustment
  • Specifying consequences of non-cooperation or non-compliance

Legislative Background and Purpose of the Commitment Mechanism

Statutory Basis under the Competition Act, 2002

The commitment regime flows from amendments made on 11.04.2023 via the Competition (Amendment) Act, 2023, which inserted Section 48B and Section 48C into the Competition Act, 2002.

  • Section 48B allows an enterprise, against whom an inquiry under Section 26(1) has been initiated for alleged contravention of Section 3(4) or Section 4, to file a commitment proposal before CCI.
  • Section 48C deals with revocation of commitment orders and prescribes the consequences once such an order is withdrawn.

The policy objective is to promote faster market correction, reduce prolonged litigation and free up CCI’s resources by incentivising early, voluntary corrective measures by enterprises.

Initial Notification of Commitment Regulations, 2024

To operationalise this mechanism, the Competition Commission of India (Commitment) Regulations, 2024 were notified on 06.03.2024. These regulations originally provided, among other things, for:

  • Prescribed form and contents of a Commitment Application and applicable fees
  • Circumstances under which CCI may reject commitment proposals
  • Time window within which commitments can be offered
  • Process for inviting and considering public and stakeholder comments on proposed commitments
  • Nature, scope and implications of a commitment order
  • Factors CCI must consider while assessing the suitability of proposed commitments
  • Monitoring of implementation and consequences of revocation

The framework represented a significant procedural reform, aiming to streamline antitrust enforcement where appropriate, especially in non-cartel, vertical and abuse-of-dominance cases.

Need for Amendments: Practical and Procedural Issues

Post-notification and initial use of the 2024 Regulations, CCI identified certain gaps and operational bottlenecks:

  • Timelines: Some time limits were either too short or not aligned with the complexity of proceedings, potentially affecting efficacy.
  • Defect Rectification: There was no detailed, structured procedure to cure incomplete or non-conforming applications, resulting in uncertainty.
  • Fee Adjustment & Invalidity: The treatment of fees where applications were defective, refiled or declared invalid was unclear.
  • Case Processing: Overall time allowed for commitment proceedings did not always match practical needs, especially where extensive stakeholder input or clarifications were required.

The proposed amendments therefore seek to:

  • Provide clearer, realistic timelines for each stage
  • Formalise the curing of defects, including consequences of non-compliance
  • Extend the maximum overall duration of commitment proceedings
  • Clarify when applications can be rejected and the procedural rights of the Commitment Applicant

Stakeholder Consultation Process

CCI has invited written comments exclusively on the draft amendments to the Commitment Regulations, 2024. As per the background note:

Stakeholders such as enterprises, industry associations, legal practitioners, economists and academicians are expected to evaluate the practicality and implications of the proposed changes and provide their feedback within this window.

Key Definitions and Scope

The Regulations define essential terms to delineate who can use the commitment route and how:

  • “Act” refers to the Competition Act, 2002.
  • “Commission” means the Competition Commission of India under Section 7(1) of the Act.
  • “Director General” carries the meaning under Section 2(g) of the Act.
  • “Commitment Applicant” is any enterprise (as defined in Section 2(h)) against whom an inquiry under Section 26(1) has been initiated for alleged violation of Section 3(4) or Section 4 and who files a Commitment Application.
  • “Commitment Application” is the application made to CCI offering commitments in relation to the alleged contraventions identified in the Section 26(1) order.

Any undefined expression is to be interpreted in line with the Competition Act, 2002, regulations under it, or the Companies Act, 2013.

Filing a Commitment Application: Content and Time Limits

Required Contents of the Application

A Commitment Applicant must file a written application along with prescribed fee under Regulation 8. The application must contain, among others, the following details:

  1. Basic particulars of the applicant
    • Name, legal form (company, firm, LLP, trust etc.), registration number if applicable
    • Registered office address and principal place of business with full contact details and website, if any